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What would happen in a political system where there are no votes, but only money to influence decision making? In such a dystopia, one might expect the well-heeled to have power and the poor to be disenfranchised. But now suppose further that even those with money find themselves bitterly divided on the central political issue of the day. Lacking the vote, the rich might wind up battling each other in a never-ending balance of powerlessness.

It may sound farfetched. Yet there is such a place: the island of Puerto Rico, a U.S. territory. Puerto Ricans are U.S. citizens. They are subject to federal laws and the draft, but they lack representation in Congress, do not pay federal taxes, and cannot vote for president. What they can do--those who can afford it--is give money to U.S. campaigns. During the current electoral cycle, Puerto Ricans have already given $1.5 million to candidates they can't vote for, including more than $750,000 in donations to Al Gore, Bill Bradley, and George W. Bush, according to the Center for Responsive Politics (CRP) and the Web site FECInfo. Even though most of the island's nearly four million residents live in poverty--its per capita income is half that of Mississippi--Puerto Rico produces more campaign contributions than some U.S. states.

And contributions aren't the half of it. To participate in the Washington power game, you also need a team of high-priced lobbyists. Or more than one team, in this case. As it happens, Puerto Rico's two rival parties have both turned to money politicking in their efforts to influence Congress and the major U.S. parties. This has frequently made for strange bedfellows. Puerto Rico's New Progressive Party (PNP) favors statehood for the island, which has been run by a "transitional" commonwealth government since 1952. This party has traditionally been aligned with U.S. Republicans. Yet the current governor of Puerto Rico, Pedro Rossello, is a pro-statehood PNP leader who considers himself a Democrat. He has close ties to the Clinton White House and is rumored to be in line for a cabinet position in a Gore administration. The Popular Democratic Party (PDP), meanwhile, favors continued commonwealth status and has long been allied with stateside Democrats. But the PDP's lead lobbyist is Charles Black, a longtime Republican stalwart and a George W. Bush campaign adviser.

These crisscrossing interests have tended to cancel one another out, keeping the money flowing but leaving the central question of Puerto Rico's self-determination in deadlock. It's true that for half a century Puerto Ricans have been able to vote in local elections and to elect their governor. They also send a nonvoting resident commissioner to Washington. And there have been several status plebiscites--always nonbinding ballots--in which Puerto Ricans have split down the middle on statehood versus commonwealth. (A third option, independence, has consistently polled in the single digits.) But Congress controls the political fate of the island. And in this, Puerto Ricans, rich and poor, are not governed by their consent. Such an arrangement has led Puerto Rico's former Chief Justice Jose Trias Monge to label the island "the oldest colony in the modern world."


Three years ago, in the 105th Congress, a bill sponsored by Republican Representative Don Young of Alaska touched off a multimillion-dollar lobbying battle on Capitol Hill between Puerto Rican statehood advocates and commonwealth defenders. H.R. 856, the United States-Puerto Rico Political Status Act, called for a binding referendum on Puerto Rico's future, requiring presidential and congressional action should Puerto Ricans vote for statehood or independence. It was supported by Puerto Rico's statehooders and independentistas. Commonwealth defenders, who fear that statehood would imperil Puerto Rico's native culture and identity, didn't like the bill, charging that it was tilted against them.

Had President Clinton been able to sign the Young bill into law, the result would have been, in important ways, unprecedented. Though Puerto Rico has been a U.S. territory since it was acquired as spoils of the Spanish American War in 1898, Congress has never approved legislation to decide its permanent status. Were Puerto Rico to become a state, it would be the most populous ever to join the union, and would become the 25th or 26th most populous state. And it would add a Spanish-speaking state to the union, which has led some conservatives to oppose statehood out of fear of a "Quebec problem."

But though Puerto Rico's self-determination bill squeaked through the House by one vote, it died in the Senate in 1998. The Young bill was quashed by Senate Republican leaders Trent Lott and Don Nickles. Indeed, though the GOP platform supports Puerto Rican statehood, only 43 of the 209 House votes favoring H.R. 856 were from Republicans. This almost certainly has to do with Republican fears that, as a highly populous state, Puerto Rico would send too many new Democrats to Congress.

Though the legislation stalled out, the debate was good for lobbyists. More than $6 million was spent in 1998 by various Puerto Rican lobbying interests, many of them focusing on the status question. The Puerto Rican government is far and away the largest source of lobbying expenditures, accounting for about $4 million that year, according to the CRP. That total--more than the combined lobbying bills of the municipal governments of Denver, Los Angeles, Miami-Dade County, and Chicago in the same year--puts Puerto Rico in the company of such major influencers as the AFL-CIO and Texaco. And during Rossello's governorship, the bent has been pro-statehood. Indeed, since Rossello took office in 1992, the rival PDP has complained that the government uses its resources inappropriately to lobby for statehood. The case is difficult to prove since money that flows through the Puerto Rico Federal Affairs Administration (PRFAA) and other government agencies can be used for traditional pleas for inclusion in federal legislation and for general discussion of how to resolve the status question. Alfonso Aguilar, the executive director of PRFAA, maintains that his agency lobbies for Puerto Rican self-determination rather than statehood. But he closely links lobbying expenses with the drive to become a state: "The reason we need to spend money on lobbyists [is] because we lack the ideal lobbyists ... two senators and six or seven members of Congress"

Of course, when the PDP controlled the governorship, it played the same game, lobbying to maintain and enhance the status quo. At present the PDP maintains an independent lobbying force dedicated to countering the statehood lobby. Some also claim that the Puerto Rican commonwealth lobby is effectively coterminous with powerful U.S. pharmaceutical interests. Many major drug companies have interests in Puerto Rico, due to Section 936 of the federal tax code, a now defunct provision that was once part of a long tradition of allowing American businesses to avoid taxes on profits earned in the territory. (Section 936 cost the U.S. government billions in revenue; it is scheduled to be phased out by 2006 for companies still in Puerto Rico.) Statehooders loathe Section 936, noting that such "corporate welfare" would be impossible were Puerto Rico a state. Commonwealthers say they hope to find a way to replace the incentives to industry created by Section 936 if they regain power.


Carlos Romero-Barcelo, a statehood advocate, is Puerto Rico's single representative in the U.S. Congress. As resident commissioner, he can attend sessions but cannot vote. One way the territory's disenfranchised status affects politics, he says, is that "when somebody asks us for campaign contributions, it becomes even more difficult to say no." And when it comes to donations, Puerto Ricans have shown themselves to be savvy givers. Statehooders have made inroads with such Democrats as Representative Patrick Kennedy of Rhode Island and Republicans such as Dan Burton of Indiana; commonwealthers have supported two representatives of Puerto Rican descent, Nydia Velazquez, a New York Democrat, and Luis Gutierrez, a Democrat of Illinois.

Most of the island's donations come from an elite class of wealthy Puerto Ricans, in large part from San Juan and its environs. The money is split roughly 65 percent to Democrats and 35 percent to Republicans. This differential is partly because statehooders have recently begun to court Democrats more aggressively under the Rossello administration. For example, Alvaro Cifuentes, Governor Rossello's former chief of staff who is now employed at the high-powered D.C. firm Verner, Liipfert, Bernhard, McPherson and Hand, is one of Al Gore's top fundraisers. On the other hand, Miguel Lausell, a pro-commonwealth Puerto Rican lawyer, has held high positions in the Democratic National Committee (DNC) and has perennially been a top party fundraiser and soft money donor.

Puerto Rican donations raised eyebrows during the 1995-1996 campaign cycle due to several huge soft money donations to the DNC linked to President Clinton's notorious White House coffees. Dr. Richard Machado, a Puerto Rican hospital owner who attempted to become the PDP candidate for mayor of San Juan in 1999 (Lausell is his lawyer), gave the DNC $250,000 within days of "coffee klatches" at the White House. That included a gift of $200,000 on November 3, 1995, the largest single donation from guests who breakfasted with Clinton between 1995 and 1996.

But the majority of Puerto Rican donations, collected mostly at fundraisers on the island, go directly to candidates. As one lobbyist explains, when members of Congress make fundraising trips to Miami, "it's only another hour and a half to San Juan, and most members find that trip worthwhile." During the primary season, Democratic presidential candidate Bill Bradley raised more than $200,000 from Puerto Rico, much of it during a trip to the island in which he courted the PDP, which was suspicious of Al Gore's ties to Rossello's statehood backers. Adds former New York Democratic congressman and current statehood lobbyist Robert Garcia, whose parents were born in Puerto Rico: "Fundraising in Puerto Rico has gone on as long as I can remember.... I depended on money from Puerto Rico because I couldn't get it from my district, the South Bronx."


Because of Puerto Rico's unique "democratic deficit"-as former PDP Governor Rafael Hernandez Colon once put it--campaign donations from the island raise unique concerns. For example: Should representatives accept money from disenfranchised Puerto Ricans and then go on to oppose self-determination legislation? After all, a case can be made that this is tantamount to allowing only money to speak for Puerto Rico and, hence, perpetuating an antidemocratic politics.

Yet representatives Gutierrez and Velazquez have opposed self-determination legislation while receiving considerable donations from Puerto Rico. When the Young bill was before Congress, the two squared off against Puerto Rico's Resident Commissioner Romero-Barcelo and Puerto Rican-born New York Representative Jose Serrano, claiming the bill would have rigged the self-determination process in favor of statehood. Gutierrez supports Puerto Rican independence, but unlike most independentistas he opposed the Young bill. Velazquez has a background in the PDP and supports commonwealth status. During the 1997-1998 campaign cycle, when the Young bill reached the House floor, Gutierrez received $41,500 in contributions from Puerto Rico, his second-largest source of income after his Illinois constituents, according to FECInfo. And astonishingly, Nydia Velazquez received $57,800 from Puerto Rico, compared to only $32,800 from her New York constituents.

Aguilar of the Puerto Rico Federal Affairs Administration says Gutierrez and Velazquez "have full political rights within the United States; however, they want to deny the same full rights to their fellow Puerto Ricans on the islands." Romero-Barcelo, meanwhile, accuses Gutierrez of using his Chicago congressional seat to pose as a representative for four million Puerto Ricans who never voted for him. In a recent statement, Gutierrez brushed aside his critics' claims and accused statehooders of tactics "that would have made George Orwell shudder with fear," including unfairly defining commonwealth in a nonbinding plebiscite in 1998. Gutierrez says that because there are many voting Puerto Ricans among his Chicago constituents, "I feel an obligation to use the office that I have attained to be a leader for all Chicagoans and for all Puerto Ricans." A spokesperson for Velazquez says the congresswoman supports self-determination for Puerto Ricans but feels the Young bill "was set up to create an unlevel playing field and tilt everyone towards statehood."

The matter of how commonwealth status is to be defined and presented to Puerto Rico's voters is not a trivial one. Commonwealth backers originally pressed for language in the Young bill that opponents said would be unconstitutional. Among other things, they wanted "commonwealth" to be described as guaranteeing U.S. citizenship, a continued exemption from federal taxes, and the power to enter into "international agreements." The proposed arrangements were voted down in committee by a margin of 32-10. With a less favorable description of commonwealth in the final bill, status quo supporters were happy to see the legislation die. In the end, the internecine struggles between Puerto Rico's factions prevent a consensus on the most basic definitions of the island's choices. And such lack of agreement on terms is a tried and true recipe for congressional inaction.


Speaking this summer at the Democratic national convention in Los Angeles, Puerto Rico's Governor Rossello plugged Al Gore's campaign by stressing Gore's commitment to work with Congress on clarifying the options available to Puerto Rico, so as to allow its residents "to choose a permanent fully democratic status." Whether Gore wins or loses, though, there is a case to be made that the onus is on Congress. Puerto Ricans can lobby and cajole and agitate, but until Congress acts, they cannot vote. They can't resolve their most basic question in the manner of a functioning democracy. One needn't take sides in Puerto Rico's bitter status debate to see that some kind of federal self-determination legislation for the territory is long overdue and that the current style of distorted politics, in which affluent Puerto Ricans fling money at Washington to no apparent effect, is insupportable.

The irony of Puerto Rico's peculiar situation is that moneyed interests have not had the final say. Money without votes is commerce, not politics. Some cynics may believe the system in the United States is approaching that market-dominated state; but no matter how bad campaign finance gets here, at least Americans retain the power of the ballot. In the case of Puerto Rico, democracy's most fundamental tool is not available. As one self-determination advocate puts it, "A penny is too much to pay when you don't have votes."
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Publication:The American Prospect
Geographic Code:1U0PR
Date:Sep 25, 2000
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